I wish to thank my clients, colleagues, industry contacts, and many friends for their contributions, insight, and support.

1. United States Secretary of the Treasury Robert Rubin coined the term TIPS in 1996, before the official launch of “Treasury Inflation-Indexed Securities” (TIIS) in January 1997. Market participants have gravitated to a generic use of the acronym TIPS to refer to all forms of inflation-linked bonds, singular and plural. For clarity, this chapter will do the same. Other terms sometimes used to describe this class of bonds include inflation-linked bonds, IPBS, TIIS, linkers, and real-return bonds.

2. The Bureau of Labor Statistics, an independent economics-oriented agency of the U.S. Department of Labor, is responsible for gathering and reporting price changes at the consumer level. The CPI series used to calculate TIPS is the non-seasonally adjusted Consumer Price Index for all Urban Consumers (CPI-U) or more simply the CPI used to calculate “headline inflation.” See the discussion about the CPI later in this chapter.